Italian law won't force takeover of Telecom
Spain's Telefonica stirs controversy with buy-out plan26 September, 15:31
Italy's takeover rules say that investors who purchase more than 30% of voting shares of an Italian company can be required by the government to make an offer to purchase all remaining shares.
But this won't apply in the current case involving Telecom Italia, now in the midst of controversy after Spain's Telefonica SA announced plans this week to increase its stake in the Italian utility, said the regulator.
"There's no such obligation under current rules," Vegas said in Senate testimony.
Spain's Telefonica announced plans this week to gradually increase its stake in Telco, which owns 22.5% of Telecom Italia, until it obtains controlling ownership – possibly sometime next year.
That triggered outrage from some quarters and fears that Italian jobs and control of an important utility is at risk.
While Italy's rules can be changed, new laws could not be made retroactive to cover the current deal, Vegas added.
Nor will any foreign laws governing corporate takeovers apply in this Italian matter, said Deputy Minister for Communications Antonio Catricalà.
"The Spaniards will have to deal with us," he said in the Senate.
The high level of government concern over the future of Telecom Italia was demonstrated in a meeting Wednesday afternoon between Italian President Giorgio Napolitano and the president of Telecom Italia Franco Bernabè over the Spanish purchase plan.
Telefonica's investment plans include a capital increase for Telco and also involve some of Italy's largest financial institutions - Intesa Sanpaolo SpA, Assicurazioni Generali SpA and Mediobanca SpA.
Italian Premier Enrico Letta told Bloomberg TV on Wednesday that his government will insist that current employment levels must be kept at Telecom Italia and the future of its strategic land-line network is also crucial.
"We will be paying very, very close attention. We don't want to lose out on this strategic aspect of the operation," Letta said.
Meanwhile, several unions including CGIL, CISL, and UIL called Thursday for urgent meetings with Letta on the issue which they say will have "very considerable consequences on the entire telecommunications sector".